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Ghana wants more oil discoveries

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Ghana wants more oil discoveries

By Peter Ward

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Ghana’s government is looking for more aggressive oil exploration in the country, as it attempts to ramp up production capacity and boost its socioeconomic development…

But how does a country like Ghana use its oil revenue? And how is this income best utilized to help people prosper in the African nation?
In May this year, Energy Minister Boakye Agyarko said oil plays a key role in Ghana’s development. “Apart from the revenue, we depend on oil for our power generation, there must be the situation where we find both enough oil and gas to make us self-sufficient,” he said at an event inducting the Board of the Ghana National Petroleum Corporation (GNPC), in Accra.

Freedom Square, Accra, Ghana (RyansWorld, Wikimedia)

Production Rising

The biggest oil field in Ghana is the offshore Jubilee field, but growth in production dropped there last year due to technical difficulties. Despite that drop, oil production in the country is expected to reach 350,000 barrels per day in 2018, according to research from the French investment management company Natixis.
Other big fields include the Tweneboa, Enyera, and Ntomme fields, which are being developed together as the TEN project. They were expected to reach peak production of 80,000 barrels per day this year.

“The current situation in the oil and gas industry is that we have found oil; yes we’ve become an oil producing nation but we cannot sit on our oars and wallow in the pleasures of what we have found,” Agyarko added. “Because what we’ve found is credible but given another 10 to 20 years, without any further find our fortunes will begin to decline. We must, therefore, adopt a posture of aggressive exploration to add to our oil reserves.”

Jubilee oil field (ghananewsghana.com.gh)

Cape Three Points

Off Ghana’s West Coast lies the Cape Three Points offshore field. Eni, which has been active in Ghana since 2009, has been operating in the Offshore Cape Three Points (OCTP) field. In May the company started production, three months ahead of schedule.
“This is a result we are especially proud of because it fits perfectly into the joint development vision that we have for Africa: we grow when the countries that host us also grow,” said Eni CEO Claudio Descalzi. “The launch of OCTP will provide gas to Ghana for over 15 years and the resulting electricity will give a real boost to the country’s development. All of this has only been possible thanks to the unwavering commitment of Ghanaian authorities and of our partners.”

In March 2016 Eni was awarded an exploration license for another 1,000 square kilometers block.
With Eni’s work, there’s a direct link between oil and gas exploration and production and social and economic development in Ghana. The company’s OCTP work promises to supply the country with a cleaner source of energy in natural gas. In fact, the whole project, which involves a $7.9 billion investment–the largest foreign investment in the country–will supply resources to generate 1,000 megawatts of power, enough to increase electricity production by 50 percent.
Eni has also implemented education and health programs in Ghana. In 2012 the Eni Foundation started a project to improve emergency services. The company has also set up three training projects to develop and enhance managerial, technical, and professional skills.
One of the health projects included support of local health authorities in three coastal areas in western Ghana. The aim was to improve services for mothers and children, and the project lasted from November 2012 to May 2017, costing approximately €8 million.

Ghana is the best example of the Eni model in Africa

UN Report

A 2015 UN report argued that more money from oil revenues should be put into a social energy program, which would “drive sustainable social change through energy security and sovereignty, the creation of green jobs, and the reduction of dramatic levels of actual and perceived income, wealth and gendered inequalities in the country in a way that will make this social change both desirable and feasible.”
The paper shows that in 2013, 68.4 percent of oil rents was spent on roads infrastructure in Ghana. The idea behind investing in roads is that it will drive growth in the country, but the UN paper argues that road building doesn’t create jobs in the same way other industries do. The author of the paper suggests that the money might be better spent on sustainable housing, and reinvesting in energy, as Ghana faces a power crisis.
Ghana’s oil and gas wealth represents a great opportunity for the country, and with the right kinds of deals and smart investment, the future could hold even more exploration and production.

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